In our latest Space, Swell's Head of Ops Salex was joined by Matthew from Maverick and Callsign from Unlock to discuss Maverick’s largest liquid locker and how swETH holders can participate in the Unlock Games.
In case you missed it, here are the top questions from the event:
What are Unlock and Maverick?
"To introduce Unlock, it is a tool that allows users to stake their MAV tokens and access veMAV. At the same time, users will receive a wrapped version of the MAV they deposit, which can be transferred and used in DeFi and the broader ecosystem.
We recently deployed the unkMAV-swETH pool that is eligible to earn keys towards the Unlock Games campaign as well as Pearls for the Swell Voyage. In the future these tokens will have further utility which will include getting a return on your MAV and the benefit of veMAV through our token UNK."
— Callsign, Unlock
"Maverick is a set of smart contracts centered around Maverick AMM which is the first dynamic distribution AMM. This AMM is capable of automatically and natively moving concentrated liquidity for LPs. There is a range of options available to choose from — Mode Right, Mode Left and Mode Both — that can be used to activate an active liquidity strategy that users don't have to manage. Concentrated liquidity is really important and valuable for supporting price, ensuring deep liquidity and helping LPs maximize their returns. The AMM will move the liquidity to stay near price, keep LPs earning fees and ideally offer better prices for traders.
Building on top of that capability, Maverick also offers an incentivization tool called ‘Boosted Positions’. Given that LPs now have the ability to create custom liquidity ranges in a pool and have them automatically move, we then added the ability to target those positions with incentives so you can decide what the ideal liquidity distribution for a token within a certain pool is, and then use incentives to attract LPs to that distribution. This solves another problem in DeFi which is until that point incentives were not terribly efficient, they used to be targeted towards an entire pool which means that you're incentivising LPs regardless of where their capital is. You may even be incentivizing LPs to put capital where you don’t want it. With ‘Boosted Positions’ you are able to target LPs and guide them to put their tokens where you need them.
I wouldn't say we were targeting LSTs when the team at Maverick put the contracts together, but Maverick launched around the same time LSTs started to take off and capture the narrative. It became a natural fit between this dynamic distribution AMM and LSTs because we can expect LSTs to always have a natural gain curve next to an asset like ETH. This is because swETH absorbs the natural yield from staking ETH and you can redeem swETH for more ETH.
We also launched the MAV token this year, and once Maverick Phase 3 launches there will be more utility for MAV. We already have the feature live where users can lock their MAV to receive veMAV, a voting balance power. This is being used for early pre—governance activities but when Phase 3 is live we will be launching a protocol incentive model similar to other ve systems.
We are happy that projects such as Unlock have popped up to offer the same value proposition for Maverick that projects like Swell offer for ETH, which is to enable the community to receive the benefit of locking or staking these tokens whilst also maintaining liquidity."
— Matthew, Maverick
What can we expect from Unlock in the coming months?
"Unlock provides the same or similar value add to Maverick that swETH offers to staked ETH. In the coming months we will be enabling protocols to have access to the power that veMAV offers. There is a lot of talk about incentives and pushing incentives to pools in a more efficient way. In the same way that Maverick allows liquidity to be efficiently structured, we hope to offer protocols the ability to direct these incentives to specific Boosted Positions by voting with UNK. This allows users to build liquidity in the same way it exists on Curve or Balancer. Hopefully this will translate to greater TVL in Maverick and greater liquidity for whatever token that is incorporated in their system.
We are also currently building ‘Switch’, a feature where anyone can post a reward to receive votes to a particular pool and grow their liquidity in a way that doesn't require them to hold ve tokens, but rather pay for liquidity. The combination of all of these things will add value to Maverick and help it grow."
— Callsign, Unlock
"It's great that Unlock is offering a swETH style layer to Maverick. There are good reasons for a protocol's voting token to be locked in a protocol because it ensures that the people guiding the decisions have a long term investment in the protocol. At Maverick we don't have to solve that problem, we institute the veMAV system and then a project like Unlock pops up to add value for the community.
I'm particularly excited about Unlock because they aren't just a liquid locker, they are building a whole layer on a Maverick meta protocol, and on top of what they are already offering, they are also working on optimizer vaults to make it easier for people to become Maverick LPs."
— Matthew, Maverick
"The optimizers will enable a few things that users have been asking for because of the way liquidity is provisioned. Some users are used to single side depositing in a pool or splitting 50/50 and farming that way. It works a little differently with Maverick but there is a way for us to enable that functionality, and that is something the optimizers will provide. The idea is users will come with swETH and that swETH is then routed to different pools to generate yield for the user based on their risk parameters.
We hope to have a beta live once the audits are complete in the next few months, and hopefully it can follow the same reaction that unkMAV has had. Since Unlock's launch the total amount of staked MAV has increased from 4% to 39% and during that time we have seen the supply of unkMAV also increase. The value add for unkMAV has been somewhat proven, and we hope to do that with all of our products."
— Callsign, Unlock
How does Swell’s LST swETH fit into this?
"With Swell being a newer entrant to the liquid staking space, we have to find a competitive edge so that we can provide the best possible product to swETH holders. As a result, we try to be early to new products and ecosystems that we can incorporate into our own, so when we first heard about Maverick and this notion of univ3 concentrated liquidity meets escrow mechanics it was quite compelling. The natural extension of this is a protocol like Unlock where you can get these advantages from bundling assets and providing the sorts of products and services that we've just been hearing about.
The general thesis for a liquid staking protocol is that eventually the LST begins to replace ETH itself across DeFi as you get more liquid. Ultimately, any natural ETH holder becomes a natural LST holder because there is no reason that you would prefer to hold vanilla ETH to an LST. It is protocols like Maverick and Unlock that allow us to build this future vision. It will be some time before it starts to happen naturally for the smaller LSTs but I'm quite confident that these are the sort of tools that we need to make it."
— Salex, Swell
"If we take Swell as an example, the base use case is that you can earn yield from staked ETH. Swell does a great job in maintaining liquidity pools across different protocols that have deep liquidity where users can easily choose to move in and out of their staked ETH position. To achieve this you need pools, an AMM and incentives. We have seen Swell use Maverick tremendously successfully as they are already the largest LP on Maverick and through Unlock, when the full architecture of Maverick is live, they'll be able to make that process even more efficient.
There are two ways to achieve liquidity in a specific pool:
- By using the voting power in veMAV or UNK, which is similar to holding staked ETH opposed to a validator you run yourself, and voting for the swETH pool with those tokens to get emissions that encourages LPs to join the pool.
- Use our upcoming ‘Switch’ feature, where you can push incentives directly to the pool or a marketplace full of veMAV voting power holders who can then vote for the pool that Swell wants them to.
If swETH holders LP in the pool, they will earn keys for the Unlock Games, and when UNK is live they will be able to claim the token to gain access to voting power and sources of additional yield by simply being a liquidity provider."
— Callsign, Unlock
Can you tell us more about the Unlock Games and what usage ‘keys’ have?
"Keys work in a similar way to how Pearls work in the Swell Voyage. Anyone that mints unkMAV and LPs into the unkMAV—swETH pool is able to earn keys at a standard rate. If a user already has swETH in the same wallet they mint unkMAV with, they will earn a specific amount of keys.
There are various multipliers that have been applied throughout this campaign and the idea is that we should encourage the users from our partners to get the most benefit of using Unlock."
— Callsign, Unlock
Do you need to mint an NFT to start collecting keys?
"If you mint unkMAV you will earn keys based on the amount of unkMAV you hold until the end of the campaign. If you mint an NFT, you will instantly receive a set amount of keys and you will also earn another multiplier on top if you stake unkMAV. You will continue to earn keys for the duration of time that the NFT or unkMAV is held in your wallet. "
— Callsign, Unlock
What can we expect from Maverick in the coming months?
"We are currently running our Season 1 campaign which will run until the launch of Phase 3. This is the first season where we have featured liquidity provision on Maverick with Boosted Positions and incentives. When Phase 3 launches, a snapshot will be taken and we will distribute rewards to users that have participated in the Maverick ecosystem in Season 1. The kind of activity that we are looking to incentivise is liquidity provision so if you're hearing about Maverick, Unlock or Swell, then now is a great time to LP on Maverick.
We have a second rewards program running which is our ve rewards program. Users that hold MAV tokens and lock it directly through the Maverick UI or through a liquid locker such as Unlock are being tracked and we will distribute those rewards when Phase 3 launches."
— Matthew, Maverick
Thanks to everyone who attended the event!
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